Financial Survey: AllianceBernstein (NYSE:AB) & Invesco (NYSE:IVZ)

AllianceBernstein (NYSE:AB) and Invesco (NYSE:IVZ) are both mid-cap finance companies, but which is the superior stock? We will compare the two companies based on the strength of their earnings, dividends, profitability, analyst recommendations, valuation, risk and institutional ownership.

Profitability

This table compares AllianceBernstein and Invesco’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
AllianceBernstein 7.18% 17.55% 17.54%
Invesco 8.15% 9.93% 2.66%

Insider & Institutional Ownership

18.7% of AllianceBernstein shares are owned by institutional investors. Comparatively, 62.9% of Invesco shares are owned by institutional investors. 2.7% of AllianceBernstein shares are owned by insiders. Comparatively, 1.9% of Invesco shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.

Dividends

AllianceBernstein pays an annual dividend of $2.44 per share and has a dividend yield of 7.4%. Invesco pays an annual dividend of $0.62 per share and has a dividend yield of 4.4%. AllianceBernstein pays out 96.8% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Invesco pays out 24.3% of its earnings in the form of a dividend. Invesco has increased its dividend for 1 consecutive years.

Risk and Volatility

AllianceBernstein has a beta of 1.53, suggesting that its share price is 53% more volatile than the S&P 500. Comparatively, Invesco has a beta of 1.3, suggesting that its share price is 30% more volatile than the S&P 500.

Analyst Recommendations

This is a summary of recent recommendations and price targets for AllianceBernstein and Invesco, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
AllianceBernstein 0 1 7 0 2.88
Invesco 3 8 2 0 1.92

AllianceBernstein currently has a consensus price target of $30.00, indicating a potential downside of 8.98%. Invesco has a consensus price target of $10.94, indicating a potential downside of 22.10%. Given AllianceBernstein’s stronger consensus rating and higher possible upside, analysts clearly believe AllianceBernstein is more favorable than Invesco.

Earnings and Valuation

This table compares AllianceBernstein and Invesco’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
AllianceBernstein $3.52 billion 0.90 $238.56 million $2.52 13.08
Invesco $6.12 billion 1.05 $688.30 million $2.55 5.51

Invesco has higher revenue and earnings than AllianceBernstein. Invesco is trading at a lower price-to-earnings ratio than AllianceBernstein, indicating that it is currently the more affordable of the two stocks.

Summary

Invesco beats AllianceBernstein on 9 of the 17 factors compared between the two stocks.

About AllianceBernstein

AllianceBernstein Holding L.P. is publicly owned investment manager. The firm also provides research services to its clients. It provides its services to investment companies, pension and profit sharing plans, banks and thrift institutions, trusts, estates, government agencies, charitable organizations, individuals, corporations, and other business entities. The firm invests in public equity, fixed income, and alternative investment markets across the globe. It employs long/short strategy to make its investments. The firm conducts in-house research to make its investments. AllianceBernstein Holding L.P. was founded in 1987 and is based in New York, New York.

About Invesco

Invesco Ltd. is a publicly owned investment manager. The firm provides its services to retail clients, institutional clients, high-net worth clients, public entities, corporations, unions, non-profit organizations, endowments, foundations, pension funds, financial institutions, and sovereign wealth funds. It manages separate client-focused equity and fixed income portfolios. The firm also launches equity, fixed income, commodity, multi-asset, and balanced mutual funds for its clients. It launches equity, fixed income, multi-asset, and balanced exchange-traded funds. The firm also launches and manages private funds. It invests in the public equity and fixed income markets across the globe. The firm also invests in alternative markets, such as commodities and currencies. For the equity portion of its portfolio, it invests in growth and value stocks of large-cap, mid-cap, and small-cap companies. For the fixed income portion of its portfolio, the firm invests in convertibles, government bonds, municipal bonds, treasury securities, and cash. It also invests in short term and intermediate term bonds, investment grade and high yield bonds, taxable and tax-free bonds, senior secured loans, and structured securities such as asset-backed securities, mortgage-backed securities, and commercial mortgage-backed securities. The firm employs absolute return, global macro, and long/short strategies. It employs quantitative analysis to make its investments. The firm was formerly known as Invesco Plc, AMVESCAP plc, Amvesco plc, Invesco PLC, Invesco MIM, and H. Lotery & Co. Ltd. Invesco Ltd. was founded in December 1935 and is based in Atlanta, Georgia with an additional office in Hamilton, Bermuda.

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